Survey: Business confidence in Scotland dips to two-year low

Survey findings, taken from responses provided by 63 Scottish-based chartered accountants, suggests oil prices, continued stagnation of the European economies and political unrest all served top dent confidence at the tail-end of 2014

Business confidence in Scotland has fallen to its lowest level in two years a survey of chartered accountants suggests.

The business monitor survey of 1,000 UK-based Chartered Accountants – including 63 in Scotland – was conducted by the Institute of Chartered Accountants in England and Wales (ICAEW) and Grant Thornton UK taken between October 27 and January 21.

It suggests the confidence score among Scottish accountants surveyed dropped to 3.6, which was down markedly on the score of 22 reported the previous quarter and lagged the average UK score of 16.8.

The report suggests lower oil prices, weak growth across Europe, the upcoming general election and political unrest in some parts of the world have been contributing factors in the decline in confidence.

“While such a significant drop in confidence is naturally concerning, there are reasons to be optimistic. “Our research shows that despite low confidence levels in the past, the Scottish business community is resilient, innovative and in good shape to face these challenges.

“Scottish business output continues to grow, as does long-term employment and remuneration. Whether low confidence translates to a drop in economic performance is yet to be seen.”

ICAEW Scotland president Paul Adderley added: “Whilst it is always disappointing to see confidence amongst Scottish businesses decline, we should be encouraged by the fact that Scottish confidence is still in positive territory.

"Factors such as the current uncertainty in the oil and gas sector and the fact that we are in the run-up to a general election have surely impacted on the confidence levels here.

"Against such a backdrop, a cautious mood is only to be expected and it will be interesting to see if confidence rallies later in the year when the election is over and we become more accustomed to impact of oil prices."